Haywood says this pot stock is a winner

In a Nov. 5 report, Haywood Capital Markets analyst Neal Gilmer maintained his “Buy” rating and C$15.00 target price on Trulieve Cannabis (Trulieve Cannabis Stock Quote, Chart, News, Analysts, Financials CSE:TRUL), citing steady execution, resilient profitability, and a solid outlook heading into fiscal 2026.

Trulieve reported third-quarter revenue of US$288.2-million, up 1.4% year over year but down 4.6% sequentially, in line with estimates of US$287.1-million (Haywood) and US$287.5-million (consensus). Adjusted EBITDA was US$102.7-million, ahead of forecasts of US$96.1-million and US$95.9-million, respectively, while Adjusted EBITDA margin of 35.6% compared with 36.6% in the prior quarter and 33.8% a year earlier. Gross margin came in at 58.9%, just below expectations, but Gilmer said overall profitability remains among the best in the U.S. cannabis sector.

Operating cash flow was US$76.8-million, with free cash flow of US$64.4-million. The company ended the period with US$457.6-million in cash and restricted cash, notes payable of US$477.5-million, and total debt of US$813.1-million.

Retail revenue accounted for 94% of total sales, reaching US$270.8-million, up 0.6% year over year. Trulieve sold over 12.5 million branded products in the quarter, up 7% from a year earlier, while companywide customer retention reached 68% and medical patient retention 76%. The company opened one new dispensary in Ohio and relocated another in Arizona, bringing its total store count to 232 locations nationwide.

Management announced plans to redeem all US$368-million of senior secured notes on Dec. 5, 2025, and may issue up to US$150-million in new notes, depending on market conditions. For the fourth quarter, Trulieve expects low single-digit revenue growth and full-year 2025 cash from operations of at least US$250-million, with capital expenditures revised upward to US$45-million.

Gilmer said Trulieve continues to demonstrate strong operational discipline, noting that “while margins may temper slightly from the past two quarters, they remain at very healthy levels.”

He said the company’s strategic expansion into Pennsylvania and Arizona complements its dominant position in Florida, making Trulieve “one of the best-positioned multi-state operators in the U.S.”

Gilmer forecasts Adjusted EBITDA of US$424.5-million on revenue of US$1.184-billion in fiscal 2025, moderating slightly to US$413.3-million on revenue of US$1.211-billion in 2026.

He said he remains positive on Trulieve’s long-term outlook, citing its strong balance sheet, cash generation, and leadership position in key U.S. cannabis markets.

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